Sunday, July 23, 2006

Could Toyota's hugs and kisses for GM, Ford be genuine?

Wednesday, July 19, 2006
Daniel Howes
Could Toyota's hugs and kisses for GM, Ford be genuine?

For a guy whose company routinely bashes Detroit Auto's collective brains in, you've gotta give Toyota Motor Corp.'s Jim Press high marks for wielding power with grace.

He said again Tuesday that General Motors Corp. and Ford Motor Co. are important to the U.S. economy, which we know. He predicted they will "come back stronger than ever and be successful," which we hope. He claimed Toyota isn't angling for a tie-up with GM, principally to foil a similar move by the Franco-Japanese alliance of Renault SA and Nissan Motor Co.

It's all very interesting this unilateral corporate love-fest, even if it belies the fiercely competitive intentions of the Japanese juggernaut's strategy to broadly dominate the global auto market and try to make a lot of us feel good about it.

Pardon some 'round here, especially at GM's RenCen and Ford's Glass House, if their response is a collective "yeah, right." This peculiarly Japanese trait of expressing concern and respect with the right hand and stamping on the gas with the right foot isn't usually mistaken for sincerity in Middle America.

With friends like these …

Because the reality is something different. To wit: last year's offer by then-Toyota Chairman Hiroshi Okuda to help GM by raising prices on the Toyota and Lexus vehicles so GM could do the same.

Never mind that the move, if it passed muster with the Federal Trade Commission's price-fixing guys, would have the felicitous byproduct of fattening Toyota's earnings. Yes, quite a sacrifice this offer is to help a friendly competitor.

That said, there are legit reasons for Toyota to want Detroit's automakers to succeed, chief among them being that American consumers drive Toyota's profits. A resurgent GM or Ford is important to Toyota to a) better ensure American economic stability so b) more Americans buy their cars and trucks without c) making Toyota a political scapegoat.

It's far more important for Toyota to prosper alongside a smaller-but-viable Big Detroit Auto contingent than court political and economic backlash should one or both of them end up in federal bankruptcy court.

Attention clueless homers

Look, Toyota is the best-managed automaker in the world. Its upward march in the North American and European markets -- and the jobs it creates here and abroad -- is a testament to its solid lineups, operational execution, massive cash hoard, ability to exploit new opportunities and a PR message turbo-charged by the success of its expanding gas-electric hybrid offerings.

Bottom line: The only people around this town who don't -- or won't -- acknowledge how strong Toyota really is are clueless homers. And those who don't see that strength as a double-edged sword are hopeless Toyota cheerleaders who figure whatever bad befalls Detroit is all Detroit's fault and Detroit deserves it.

Partly, yes. But how an implosion here would be good for America is far more difficult to persuasively argue because it wouldn't be. Jim Press would agree with that.

Daniel Howes' column appears Mondays, Wednesdays and Fridays. He can be reached at (313) 222-2106 or

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